INDEPENDENT AUDITOR'S OPINION RESULTING FROM ANALYSIS OF MERGER PLAN of Bank BPH S. A. with GE Money Bank S.A.

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1 Kraków, 18 August 2009 Janina Niedośpiał ul. Słomiana 13/ Kraków Chartered auditor no 2729/2068 Court expert District Court for Kraków Śródmieście in Kraków 11th Commercial Division of National Court Register Ref. no.: KR XI Ns Rej. KRS 15765/09/027 INDEPENDENT AUDITOR'S OPINION RESULTING FROM ANALYSIS OF MERGER PLAN of Bank BPH S. A. with GE Money Bank S.A. Under the decision of the District Court for Kraków Śródmieście in Kraków, 11th Commercial Division of National Court Register of 10 August 2009, concerning the appointment of an expert in the person of Janina Niedośpiał, entered on the list of court experts of the Regional Court in Kraków, in connection with the planned merger of Bank BPH S.A. with the registered office in Kraków with GE Money Bank S.A. with the registered office in Gdańsk, I have examined the Merger Plan of 29 July 2009, including: 1. Definitions used in the Merger Plan, 2. Type, business name and registered office of each Company participating in the merger, 3. Way of effecting the merger and its legal grounds, 4. Premises and benefits arising out of the merger, 1

2 5. Methodology and principles of determining the exchange ratio of shares in the Acquired Company for shares in the Acquiring Company, 6. Principles concerning the allocation of shares in the Acquiring Company, 7. Day from which the shares of the Acquiring Company granted to shareholders of the Acquired Company in connection with the merger give the right to participate in the Acquiring Company's profit, 8. Rights granted by the Acquiring Company to the shareholders of the Acquired Company and to other persons with special rights in the Acquired Company, 9. Special benefits for members of governing bodies of the merging companies and for other persons participating in the Merger, 10. Agreement of the Merger Plan, 11. List of Appendices to the Merger Plan. The following documents were appended to the Merger Plan: draft resolution of the Extraordinary General Meeting of Shareholders of Bank BPH S.A. concerning the Merger, including the draft of Articles of Association of BPH S.A. after the Merger and a resolution concerning the proposed decrease of the share capital; draft resolution of the Extraordinary General Meeting of Shareholders of GE Money Bank S.A. concerning the Merger, including the draft of Articles of Association of BPH S.A. after the Merger; net value of GE Money Bank S.A.'s property as of 1 June 2009; statement with information about the books of GE Money Bank S.A. presented in the statements prepared for the purposes of the Merger as of 1 June 2009; statement with information about the books of BPH S.A. presented in the statements prepared for the purposes of the Merger as of 1 June 2009; excerpt from the National Court Register for BPH S.A. 2

3 excerpt from the National Court Register for GE Money Bank S.A. The Management Boards of BPH S.A. and GE Money Bank S.A are responsible for the preparation of the Merger Plan. My task was to express an opinion about the enclosed Merger Plan, on the basis of the conducted study. My opinion was prepared only for the use of the District Court for Kraków Śródmieście in Kraków, 11th Commercial Division of National Court Register and shareholders of Banks participating in the Merger; it cannot be used for any other purposes. I shall not be held liable in respect to third parties under the content hereof. The study was conducted according to: articles 502 and 503 of the act of 15 September 2000 Code of Commercial Companies (Journal of Laws Dz. U. No 94, item 1037, as amended), referred to hereafter as CCC, Standards for following the profession of auditor, issued by the National Council of Statutory Auditors in Poland, International Standard on Assurance Engagements (ISAE) I have planned and conducted the study so as to become reasonably certain that the Merger Plan does not include any crucial irregularities and to obtain sufficient grounds to express a reliable opinion about the Merger Plan. The study consisted of the following procedures, without limitation: verifying whether the Merger Plan agreed by the merging Banks was prepared according to article of CCC and whether it includes all appendices required by article of CCC; 3

4 analysing the justness of share evaluation methods adopted by the Management Boards of the merging Banks in order to calculate share exchange parity; checking whether the evaluation of shares of the merging Banks was calculated properly, according to the methods used by the Management Boards of both Banks and whether the share exchange parity was determined according to these calculations. The conducted study is a sufficient basis for this opinion to be issued. On the basis of the conducted study I state that the appended Merger Plan for Bank BPH S.A. with its registered office in Kraków and GE Money Bank S.A. with its registered office in Gdańsk includes all information specified in article 499 & 1 and 2 of CCC, and moreover: correctly determines the exchange ratio of shares of the acquired bank to shares of the acquiring bank, the method used to determine the share exchange ratio suggested in the Merger Plan is justified, evaluation of shares of the merging Banks presented in the Merger Plan did not present any difficulties, and the method applied allowed to reflect the current market value of the banks in a reliable manner. Therefore, I state that the Merger Plan for Bank BPH S.A. with its registered office in Kraków and GE Money Bank S.A. with its registered office in Gdańsk was prepared in a correct and reliable manner. 4

5 ... Janina Niedośpiał Chartered Auditor No. 2729/2068 Substantiation of the opinion Initial findings With its decision of 10 August 2009, ref. no KR XI Ns Rej. KRS 15765/09/027, the District Court for Kraków Śródmieście in Kraków, 11th Commercial Division of National Court Register appointed Janina Niedośpiał, entered on the list of court experts of the Regional Court in Kraków, in connection with the planned merger of Bank BPH S.A. with the registered office in Kraków and GE Money Bank S.A. with the registered office in Gdańsk, to examine the Merger Plan of 29 July 2009 in the scope of its correctness and reliability. General findings The Acquiring Company: Bank BPH Spółka Akcyjna with its registered office in Kraków, address: Al. Pokoju 1 entered in the register of entrepreneurs of the National Court Register run by the District Court for Kraków Śródmieście, 11th Commercial Division of National Court Register, with number KRS

6 The Acquired Company: GE Money Bank Spółka Akcyjna with its registered office in Gdańsk, address: ul Elżbietańska 2 entered in the register of entrepreneurs of the National Court Register run by the District Court for Gdańsk Północ, 7th Commercial Division of National Court Register, with number KRS Manner of effecting the merger The merger will be effected under articles and of the Banking law, in connection with article 492 & 1 item 1 of CCC, by way of transfer of the whole property of GEMB to BPH, at the same time increasing the share capital of BPH by a new issue of shares, to be allocated by BPH to shareholders of GEMB. BPH's share capital will be increased by the amount of PLN 334,380,985 (say: three hundred and thirty four million three hundred and eighty thousand nine hundred and eighty five), i.e. up to the amount of PLN 477,962,135 (say: four hundred and seventy seven million nine hundred and sixty two thousand one hundred and thirty five), by issuing the Shares of Merger Issue. The banks' balance sheets prepared for the purposes of the merger The balance sheet of Bank BPH S.A. prepared as of 1 June 2009 indicates the amount of PLN 14,548,102,000 as assets and liabilities, value of net assets PLN 1,492,421,000 The balance sheet of GE Money Bank S.A prepared as of 1 June 2009 indicates the amount of PLN 23,505,316,000 as assets and liabilities, 6

7 value of net assets PLN 3,788,198,000 Bank BPH S.A. and GE Money Bank S.A. presented identical accounting principles applied during the preparation of balance sheets. These principles are consistent with the requirements of the IFRS approved by the EU. The presented accounting standards used for the preparation of balance sheets of both Banks are used by the banks in a constant manner for preparing their financial statements according to the IFRS. The Balance sheet of Bank BPH S.A. prepared as of 1 June 2009 with the note The basis for the preparation of the balance sheet including a description of vital accounting standards was audited by KPMG Audyt Sp. z o.o. with its registered office in Warsaw, ul. Chłodna 51. The report of an independent auditor on the review of the balance sheet includes a statement saying that the review did not find anything that could lead to a conclusion that the appended balance sheet of BPH S.A. as of 1 June 2009 was prepared inconsistently in respect to the note The basis for the preparation of the balance sheet in all crucial respects. The Balance sheet of GE Money Bank S.A. prepared as of 1 June 2009 with the note The basis for the preparation of the balance sheet including a description of vital accounting standards was audited by KPMG Audyt Sp. z o.o. with its registered office in Warsaw, ul. Chłodna 51. The report of an independent auditor on the review of the balance sheet includes a statement saying that the review did not find anything that could lead to a conclusion that the appended balance sheet of GE Money Bank S.A. as of 1 June 2009 was prepared inconsistently in respect to the note The basis for the preparation of the balance sheet in all crucial respects. 7

8 Detailed findings Methodology and principles of determining the exchange ratio of shares in the Acquired Company for the shares of the Acquiring Company Main evaluation methods applied in respect to both banks consisted in: a relative evaluation basing on market values for comparable Polish banks, fundamental evaluation using the Dividend Discount Model The first method relied on the predicted profitability and yield of comparable Polish banks and two relative methods: differentiation of trade and regression analysis. In the second method, the bank's net value was calculated, adopting appropriate discount rates and basing on asset and revenue increase profile, capital required to achieve balance sheet increase and the resulting increase of capacity to pay the dividend to shareholders. In both banks, the Management Boards' forecasts and plans were used in order to prepare the models basing on the assumption that both banks will act as separate enterprises, without merger. When determining the Share Exchange Ratio, the BPH Management Board used the evaluation of BPH and GEMB prepared by J.P. Morgan plc. The GEMB Management Board used the evaluation of BPH and GEMB prepared by Goldman Sachs. On 29 July 2009 J.P. Morgan plc. issued and Opinion on Reliability of Transaction Conditions for BPH. On the basis of assumptions and evaluation methods used in the evaluation of BPH's and GEMB's property, it was determined that the Share Exchange Parity will correspond to the ratio: BPH share for one GEMB share. 8

9 For 56,245,751 /fifty six million two hundred and forty five thousand seven hundred and fifty one/ shares of GE Money Bank, GEMB shareholders will receive 66,876,197 /sixty six million eight hundred and seventy six one hundred ad ninety seven/ of Merger Issue Shares. The Share Exchange Ratio was accepted by the Management Boards of both banks. The number of Merger Issue Shares to be allocated to particular shareholders of GEMB will be calculated as a product of the number of shares owned by a particular GEMB shareholder on the Day of Merger and the Share Exchange Ratio. If necessary, such product will be rounded down to the next integer, and for the inefficient fraction of shares, GEMB shareholders will be entitled to receive extra cash from BPH. This opinion with the substantiation consists of 9 pages initialled by the expert. 9